Consumer Expenditures in 2015

This Consumer Expenditure Survey (CE) Annual Report presents integrated data from the 2015 Diary and Interview portions of the CE, including data tables. The tables show average expenditures, income, and characteristics for consumer units1 classified by the following characteristics: quintiles and deciles of income, before-tax income class, age of the reference person, size of the consumer unit, composition of the consumer unit, number of earners, housing tenure and type of area (urban or rural), region of residence, occupation, highest education level of any consumer-unit member, race, and Hispanic or Latino origin. This report highlights spending patterns for 2015 from the CE, including a brief discussion of expenditure changes for the year, and provides a description of the CE survey.

Consumer spending increased 4.6 percent in 2015, according to annual data from the CE. This follows an increase of 4.7 percent in 2014, previously recorded by the CE. The average annual expenditures by consumer units (CUs) increased from $53,495 in 2014 to $55,978 in 2015. Accompanying the 2015 increase in expenditures was an increase of 4.1 percent in average income before taxes from 2014 ($66,877) to 2015 ($69,627). Prices, as measured by the average annual change in the Consumer Price Index for All Urban Consumers (CPI-U, U.S. city average, all items, base period 1982–1984=100), rose by 0.1 percent in 2015, compared with the 4.6-percent increase in spending. In 2014, prices increased by 1.6 percent, compared with the 4.7-percent increase in spending.

Developments in 2015

During 2015, spending increased across the nine largest aggregated categories of expenditures tracked by CE: food, housing, apparel and services, transportation, healthcare, entertainment, education, cash contributions, and personal insurance and pensions. (See table A.) Expenditures on healthcare and cash contributions rose only slightly, up 1.2 and 1.7 percent, respectively. Expenditures on education and personal insurance and pensions rose more noticeably, up 6.4 percent and 10.9 percent, respectively. Expenditures on food, housing, apparel and services, transportation, and entertainment rose between 3.4 and 4.7 percent, continuing the increases observed in 2014.

Consumer confidence levels also increased from 87 in 2014 to 98 in 2015, as published by the Consumer Confidence Index of the Conference Board. (The base year for the Consumer Confidence Index is 1985. Index values of 100 or higher reflect greater consumer optimism than measured in the base year.) The improvement in consumer confidence coincides with the gradual decline in the unemployment rate in 2015. According to the Current Population Survey, the monthly unemployment rate fell steadily throughout the year, from 5.7 percent in January to 5.0 percent in December. The average unemployment rate in 2015 was 5.3 percent, compared with an average of 6.2 percent in 2014. Despite these declines in the unemployment rate, the measure still remained above prerecession levels of 4.6 percent in 2006 and 2007. Although the number of long-term unemployed individuals (those without a job for 27 weeks or more) declined from 3.2 million in 2014 to 2.3 million in 2015, it was still higher than prerecession levels (1.2 million in 2007). In addition, the rise in consumer confidence may reflect the acceleration in the economic recovery, as shown by the 2.4-percent increase in real GDP in 2015, compared with a 1.2-percent increase in 2014.

Table A. Average annual expenditures by major category of all consumer units and percent changes, Consumer Expenditure Survey, 2012–15

Item

2012

2013

2014

2015

Percent change

2012–13

2013–14

2014–15

Number of consumer units (in thousands)

124,416

125,670

127,006

128,437

…

…

…

Consumer unit characteristics

Income before taxes

$65,596

$63,784

$66,877

$69,627

-2.8

4.8

4.1

Age of reference person

50.0

50.1

50.3

50.5

…

…

…

Average number in consumer unit

People

2.5

2.5

2.5

2.5

…

…

…

Children under 18

0.6

0.6

0.6

0.6

…

…

…

Adults 65 and older

0.3

0.3

0.4

0.4

…

…

…

Earners

1.3

1.3

1.3

1.3

…

…

…

Vehicles

1.9

1.9

1.9

1.9

…

…

…

Percent homeowner

64

64

63

62

…

…

…

Average annual expenditures

$51,442

$51,100

$53,495

$55,978

-0.7

4.7

4.6

Food

6,599

6,602

6,759

7,023

0

2.4

3.9

Food at home

3,921

3,977

3,971

4,015

1.4

-0.2

1.1

Cereals and bakery products

538

544

519

518

1.1

-4.6

-0.2

Meats, poultry, fish, and eggs

852

856

892

896

0.5

4.2

0.4

Dairy products

419

414

423

413

-1.2

2.2

-2.4

Fruits and vegetables

731

751

756

769

2.7

0.7

1.7

Other food at home

1,380

1,412

1,382

1,419

2.3

-2.1

2.7

Food away from home

2,678

2,625

2,787

3,008

-2.0

6.2

7.9

Alcoholic beverages

451

445

463

515

-1.3

4.0

11.2

Housing

16,887

17,148

17,798

18,409

1.5

3.8

3.4

Shelter

9,891

10,080

10,491

10,742

1.9

4.1

2.4

Owned dwellings

6,056

6,108

6,149

6,210

0.9

0.7

1.0

Rented dwellings

3,186

3,324

3,631

3,802

4.3

9.2

4.7

Other lodging

649

649

710

730

0

9.4

2.8

Utilities, fuels, and public services

3,648

3,737

3,921

3,885

2.4

4.9

-0.9

Household operations

1,159

1,144

1,174

1,309

-1.3

2.6

11.5

Housekeeping supplies

610

645

632

655

5.7

-2.0

3.6

Household furnishings and equipment

1,580

1,542

1,581

1,818

-2.4

2.5

15.0

Apparel and services

1,736

1,604

1,786

1,846

-7.6

11.3

3.4

Transportation

8,998

9,004

9,073

9,503

0.1

0.8

4.7

Vehicle purchases (net outlay)

3,210

3,271

3,301

3,997

1.9

0.9

21.1

Gasoline and motor oil

2,756

2,611

2,468

2,090

-5.3

-5.5

-15.3

Other vehicle expenses

2,490

2,584

2,723

2,756

3.8

5.4

1.2

Public and other transportation

542

537

581

661

-0.9

8.2

13.8

Healthcare

3,556

3,631

4,290

4,342

2.1

18.1

1.2

Entertainment

2,605

2,482

2,728

2,842

-4.7

9.9

4.2

Personal care products and services

628

608

645

683

-3.2

6.1

5.9

Reading

109

102

103

114

-6.4

1.0

10.7

Education

1,207

1,138

1,236

1,315

-5.7

8.6

6.4

Tobacco products and smoking supplies

332

330

319

349

-0.6

-3.3

9.4

Miscellaneous

829

645

782

871

-22.2

21.2

11.4

Cash contributions

1,913

1,834

1,788

1,819

-4.1

-2.5

1.7

Personal insurance and pensions

5,591

5,528

5,726

6,349

-1.1

3.6

10.9

Life and other personal insurance

353

319

327

333

-9.6

2.5

1.8

Pensions and Social Security

5,238

5,209

5,399

6,016

-0.6

3.6

11.4

Source: U.S. Bureau of Labor Statistics.

Expenditure shares

Table B provides the percent distribution of total annual expenditures shares by major expenditure categories for all CUs from 2012 to 2015. Expenditure shares usually do not fluctuate much in the short term and therefore are more useful for identifying spending trends over time. As in previous years, housing was the largest component of overall expenditures, accounting for 32.9 percent of total expenditures in 2015. Housing expenditures were followed by transportation (17.0 percent) and food expenditures (12.5 percent).

The most notable changes in expenditure shares between 2014 and 2015 were in personal insurance and pensions, and the transportation subcategories of vehicle purchases and gasoline and motor oil. Personal insurance and pensions increased from 10.7 percent to 11.3 percent of expenditures, reversing multiple years of consecutive decline. Although the share for total transportation held steady at 17.0 percent, within that category, vehicle purchases increased from 6.2 percent to 7.1 percent of expenditures, and gasoline declined from 4.6 percent to 3.7 percent of spending. Healthcare decreased from 8.0 percent to 7.8 percent. The shares for all other major categories stayed the same or remained within 0.1 percentage point of their 2014 levels.

Table B. Percent distribution of total annual expenditures by major category for all consumer units, Consumer Expenditure Survey, 2012–15

Spending category

2012

2013

2014

2015

Average annual expenditures

100.0

100.0

100.0

100.0

Food

12.8

12.9

12.6

12.5

Food at home

7.6

7.8

7.4

7.2

Food away from home

5.2

5.1

5.2

5.4

Alcoholic beverages

0.9

0.9

0.9

0.9

Housing

32.8

33.6

33.3

32.9

Shelter

19.2

19.7

19.6

19.2

Utilities, fuels, and public services

7.1

7.3

7.3

6.9

Household operations

2.3

2.2

2.2

2.3

Housekeeping supplies

1.2

1.3

1.2

1.2

Household furnishings and equipment

3.1

3.0

3.0

3.2

Apparel and services

3.4

3.1

3.3

3.3

Transportation

17.5

17.6

17.0

17.0

Vehicle purchases (net outlay)

6.2

6.4

6.2

7.1

Gasoline and motor oil

5.4

5.1

4.6

3.7

Other vehicle expenses

4.8

5.1

5.1

4.9

Public and other transportation

1.1

1.1

1.1

1.2

Healthcare

6.9

7.1

8.0

7.8

Entertainment

5.1

4.9

5.1

5.1

Personal care products and services

1.2

1.2

1.2

1.2

Reading

0.2

0.2

0.2

0.2

Education

2.3

2.2

2.3

2.3

Tobacco products and smoking supplies

0.6

0.6

0.6

0.6

Miscellaneous

1.6

1.3

1.5

1.6

Cash contributions

3.7

3.6

3.3

3.2

Personal insurance and pensions

10.9

10.8

10.7

11.3

Life and other personal insurance

0.7

0.6

0.6

0.6

Pensions and Social Security

10.2

10.2

10.1

10.7

Source: U.S. Bureau of Labor Statistics.

Housing

Average expenditures on mortgage interest and charges for homeowners with a mortgage decreased only slightly in 2015. Homeowners spent 0.2 percent less on this component in 2015 ($7,939) than they did in 2014 ($7,952). By comparison, homeowners with a mortgage spent $8,779 on this component in 2007. This reflects the continuing trend of lower interest rates, which, despite recent increases, has been in place since the recent recession that began in December 2007 and ended in June 2009.

In addition, although the recession led to an overall trend of fewer CUs owning homes, the CE reported a reversal of this trend in 2013, when the number of homeowners increased from 79.9 million in 2012 to 80.1 million in 2013. There has not been much change since then, with homeownership declining to 79.6 million in 2014 and increasing to 80.0 million in 2015, still slightly below the prerecession level of 80.2 million homeowners in 2007 (homeowners made up 66.8 percent of all CUs in that year).

In percentage terms, homeownership dropped again this year to 62.3 percent from 62.7 percent in 2014. According to the CPI-U, rents for primary residences have increased 21.9 percent between 2007 and 2015. During the 2007–15 time span, the average annual rental payments reported in the CE increased 28.0 percent ($9,900 in 2015, compared with $7,732 in 2007), reflecting the increase in demand for rental units.

Also of note is the drop in spending on utilities, fuels, and public services, as a percentage of total expenditures, from 7.3 percent in 2014 to 6.9 percent in 2015. By comparison, expenditures on this item reached 7.6 percent of expenditures in 2010. This decline is partially due to lower expenditures on natural gas and electricity, which declined 4.1 percent and 1.6 percent, respectively, from 2014 to 2015.

Gasoline

Average expenditures on gasoline decreased in 2015. CUs spent 16.1 percent less in 2015 ($1,915) than they did in 2014 ($2,284), reflecting how oil and gasoline prices decreased throughout 2015. Chart 1 shows the percent change in expenditures on gasoline and the price of gasoline between 2007 and 2015. For most years, the change in consumer spending is similar to the change in prices. In 2015, the percentage decline in spending on gasoline was smaller (16.1 percent) than the drop in the CPI index for gasoline (27.2 percent).

Gasoline expenditures decreased in every income quintile in 2015. The first (lowest) quintile had the largest percentage decrease in expenditures from 2014 to 2015—a decline of 19.7 percent—from $1,095 to $880. By age of reference person, all age groups decreased spending in 2015. The largest percentage decrease was in the 65­–74 age group (down 19.3 percent to $1,535), followed by the 55­–64 age group (down 18.3 percent to $1,946).

Expenditures by income quintile

Spending increased across all five income quintiles in 2015. This continued the trend seen in 2014, when there were also increases in all five income quintiles. (See chart 2.) The third quintile increased spending by 1.1 percent in 2015, while the lower two and upper two quintiles increase spending between 3.2 and 5.9 percent. Table C shows more details on spending by income quintile.

All income quintiles showed higher spending on food away from home, housing, transportation, and personal insurance and pensions in 2015 relative to 2014. (See table C.) Among these categories, personal insurance and pensions expenditures rose most significantly, with increases between 9.0 percent and 18.2 percent among the quintiles. Cash contributions expenditures rose for the lowest (up 40.7 percent) and highest quintiles (up 3.1 percent), while the middle three quintiles reduced their expenditures in this category between 1.2 percent and 7.1 percent. Food at home, apparel and services, and healthcare all saw increases in 3 of the 5 quintiles. Four of five quintiles increased spending on entertainment, food, and all other expenditures.

Table C. Dollar change and percent change in average annual expenditures on major categories by income quintile, Consumer Expenditure Survey, 2014–15

Item

Lowest

Second

Third

Fourth

Highest

Dollar

Percent

Dollar

Percent

Dollar

Percent

Dollar

Percent

Dollar

Percent

Average annual expenditure change

Total

757

3.2

1517

4.5

517

1.1

3254

5.4

6145

5.9

Food

100

2.7

268

5.6

-193

-3.2

386

5.0

755

6.5

Food at home

-7

-0.3

133

4.2

-225

-6.1

44

1.0

271

4.5

Food away from home

106

9.1

135

8.4

32

1.4

343

10.5

485

8.7

Housing

247

2.6

324

2.6

361

2.3

840

4.3

1215

3.8

Apparel and services

-10

-1.3

17

1.5

-231

-15.1

126

6.8

400

11.0

Transportation

4

0.1

227

4.0

345

4.1

486

4.5

1046

6.2

Healthcare

62

3.3

171

5.3

-61

-1.5

245

4.8

-171

-2.4

Entertainment

162

14.6

172

11.0

-146

-6.2

83

2.8

290

5.2

Cash contributions

206

40.7

-80

-7.1

-84

-5.9

-23

-1.2

123

3.1

Personal insurance and pensions

91

18.2

146

9.2

427

12.0

921

13.7

1467

9.0

All other expenditures

-105

-5.1

272

14.2

99

3.8

190

5.2

1020

13.6

Source: U.S. Bureau of Labor Statistics.

Food

Food expenditures increased for all but the third quintile in 2015. This is similar to 2014, when expenditures increased for all but the second quintile. The highest quintile registered the largest percentage increase in food expenditures, an increase of 6.5 percent, from $11,595 in 2014 to $12,350 in 2015. This reflected a 4.5-percent increase in food-at-home spending and an 8.7-percent increase in food-away-from-home expenditures. Although expenditures on food away from home for the upper two and lower two quintiles increased significantly, with percentage increases ranging from 8.4 to 10.5, no clear pattern emerged for expenditures on food at home. The lowest and third quintile reduced expenditures by 0.3 and 6.1 percent, respectively; the second, fourth, and highest quintiles increased expenditures 4.2, 1.0, and 4.5 percent, respectively.

There was an increase in food expenditures in all but the 65–74 age group (which declined 1.4 percent) in 2015. The under-25 and 35–44 age groups had the highest percentage increase in overall food expenditures in 2015, up 10.6 and 9.7 percent, respectively, outpacing their overall expenditure increases of 1.9 and 4.5 percent. The 45–54 and over-75 age groups also increased overall food expenditures by considerable margins, up 4.6 percent and 4.9 percent, respectively. These increases were similar to their overall expenditure increases of 6.2 percent and 4.0 percent. Increases for the 25–34 and 55–64 age groups were more modest, up 0.1 and 2.8 percent, respectively, which was lower than the rate of increase in their overall expenditures, up 5.1 percent and 4.5 percent, respectively.

Notes

1 A consumer unit consists of either: (1) all members of a particular household who are related by blood, marriage, adoption, or other legal arrangements; (2) a person living alone or sharing a household with others or living as a roomer in a private home or lodging house or in permanent living quarters in a hotel or motel, but who is financially independent; or (3) two or more persons living together who use their income to make joint expenditure decisions.

Statistical Tables

Table 1. Quintiles of income before taxes: average annual expenditures and characteristics, Consumer Expenditure Survey, 2015

Technical Notes

Starting in 1888, the Consumer Expenditure Survey (CE) was collected approximately every 10 years until 1973; annual collection began in late 1979. The CE’s principal objective is to collect information on the buying habits of U.S. consumers. Consumer expenditure data are used in a variety of research activities by government, business, labor, and academic analysts. In addition, the data are required for the regular revision of the Consumer Price Index (CPI) market basket. The CE, which is conducted by the U.S. Census Bureau for the Bureau of Labor Statistics, consists of two survey instruments with independent samples: a Diary Survey completed by participating consumer units (CUs) for two consecutive 1-week periods, and an Interview Survey in which expenditures of consumer units are obtained in four interviews over the course of a year, conducted at 3-month intervals. Results in this report are based on integrated data from both surveys. Survey participants record dollar amounts for goods and services purchased during the reporting period, regardless of whether payment is made at the time of purchase. Expenditure amounts include all sales and excise taxes for items purchased by the consumer unit. All business-related expenditures are excluded from both surveys, as are expenditures for which the CU is reimbursed.

Each survey queries an independent sample of CUs that are representative of the U.S. population. For the Diary Survey, about 7,000 consumer units are sampled each year. Each CU keeps a diary for two 1-week periods, yielding approximately 14,000 diaries a year. The Interview Survey, selected on a rotating panel basis, collects data from about 7,000 CUs each quarter. With the rotating panel, some CUs rotate out of the survey each quarter, while others rotate in. Each consumer unit is interviewed once per quarter, for four consecutive quarters. Data are collected on an ongoing basis in 91 geographic areas of the United States. The Interview Survey is designed to capture expenditure data that respondents can reasonably recall for a period of 3 months or longer. In general, these expenditures are relatively large, such as expenditures for real property, automobiles, and major appliances, or they occur on a regular basis, such as rent, utility payments, and insurance premiums. The Interview Survey also collects data on expenditures incurred on leisure trips. Including broad estimates of food spending, it is estimated that about 95 percent of expenditures are covered in the Interview Survey. Nonprescription drugs, household supplies, and personal care items are excluded. The Diary Survey is designed to capture expenditures on small, frequently purchased items that are normally more difficult for respondents to recall buying over an extended period. Detailed entries of expenses are kept for food and beverages—consumed either at home or in eating places—and for tobacco, housekeeping supplies, nonprescription drugs, personal care products and services, most apparel, and any other goods or services purchased within the period. Expenditures incurred by members of the CU while away from home overnight or longer are excluded from the Diary Survey. Although this survey was designed to collect information on expenditures that could not be recalled easily over an extended period, respondents are asked to report all expenses (except those spent while traveling overnight that the consumer unit incurs during the survey week.)

Integrated data from the Diary and Interview Surveys provide a complete accounting of consumer expenditures and income that neither survey is designed to do on its own. Data on some expenditure items are collected in only one of the surveys. For example, the Diary Survey does not collect information on reimbursements, whereas the Interview Survey does. Examples of expenditures for which reimbursements are excluded from the Diary Survey are medical care; automobile repairs; and construction, repairs, alterations, and maintenance of property. For items that are unique to one survey or the other, the choice of which survey to use as the source of data is obvious. However, there is considerable overlap in coverage between the surveys, and integrating the data involves a determination of the appropriate survey from which to select specific expenditure items. When data are available from both surveys, the more reliable of the two as determined by statistical methods is selected. As a result, some items are selected from the Interview Survey, others from the Diary Survey. Because of the overlap in the item coverage between the two surveys, the survey source is reviewed every 2 years and statistical methods are used to select the best source. See “CE Source Selection for Publication Tables” in the Consumer Expenditure Survey Anthology, 2011 (BLS Report, no. 1030) for source selection details.

The population and spending coverage of the CE differs from those used by the CPI. The CE data cover the total population including rural areas, whereas the CPI covers only the population in urban and metropolitan areas. Definitions of components also differ between the CE and CPI. For example, homeownership is treated differently in the two surveys: actual expenditures of homeownership are reported in the CE, whereas the CPI uses a rental equivalence approach that estimates the change in the cost of obtaining, in the rental marketplace, services equivalent to those provided by owner-occupied homes.

Interpreting the data

Expenditures are averages for CUs with specified characteristics, regardless of whether a particular unit incurred an expense for a specific item during the recordkeeping period. The average expenditure for an item may be considerably lower than the expenditure by the consumer units that purchased the item. The less frequently an item is purchased, the greater the difference between the average for all consumer units and the average for those purchasing the item. Similarly, an individual consumer unit may spend more or less than the average, depending on its particular characteristics. Factors such as income, age of family members, geographic location, and personal preference also influence expenditures. In addition, even within groups with similar characteristics, the distribution of expenditures varies substantially. These points should be considered when comparing reported averages to individual circumstances. Users of these survey data should also keep in mind that prices for many goods and services have risen since the survey was conducted. For example, all prices, as measured by the CPI-U, increased 1.3 percent from 2015 (annual average index) to 2016 (not seasonally adjusted). In addition, sample surveys are subject to two types of error: sampling and nonsampling. Sampling errors occur because the data are collected from a sample representing the population, rather than from the entire population. Nonsampling errors result from the inability or unwillingness of respondents to provide correct information, differences in interviewers’ abilities, mistakes in recording or coding, and other processing errors.

Tables and data

Tables in this report include integrated data from both the Diary and Interview components of the CE, enabling data users to associate the full range of expenditures with consumers’ demographic characteristics. Tables show data classified by income quintile, income decile, income class, age of the reference person, size of the consumer unit, composition of the consumer unit, number of earners, housing tenure, type of area (urban or rural), race, Hispanic origin, region of residence, occupation, and highest education level of any consumer-unit member. Tables for the aforementioned classifications, but with more detail than is given in this report, can be accessed on the CE page of the BLS website. Also available are tables showing average annual data over a 2-year period for

1. income before taxes, cross-tabulated by age, consumer unit size, or region

2. single consumers by gender, cross-tabulated by either income or age

3. selected metropolitan statistical areas (MSAs).

Data are available for 1984–2015. Other survey information available on the website includes answers to frequently asked questions, a glossary of terms, and order forms for survey products. Beginning with the 2000 data, estimates of standard errors for integrated Diary and Interview Survey data are also available.

The CE also produces prepublication tables, which are more detailed and contain additional subcategories of spending, but also have larger variances. They are available upon request to CEXInfo@bls.gov. Prepublication tables for all CUs are now available.

Other available data

The 2015 CE public-use microdata, including Interview Survey data, Diary Survey data, and paradata (information about the survey process), are available on the CE website for free electronic download. The Interview Survey files contain expenditure data in two different formats: MTBI files that present monthly values by coding items based on the CPI pricing scheme, and EXPN files that organize expenditures by the section of the Interview Survey questionnaire in which they are collected. Expenditure values on EXPN files cover different time periods depending on the specific questions asked, and the files also contain relevant nonexpenditure information not found on the MTBI files. Beginning with the 2013 public-use microdata, the new estimates of local, state, and federal tax liabilities are included. The CE introduced these estimates to improve the quality of the surveyed tax liabilities, which suffered from low response rates. The surveyed public-use tax data were still available for 2013, after which they were no longer collected. For more information on the improvements, see Improving Data Quality in the Consumer Expenditure Survey with TAXSIM, and for new applications of the tax estimates see New and Improved Estimates of Personal Income Taxes have Tripled the Tax Data.

Free public-use microdata are available online from the years 1996 to 2015. For releases published before 1996, users can continue to purchase USB flash drives using the public-use microdata order form. Future releases of public-use microdata will be available online for free download.

Information on the methodology used to calculate and collect CE data is available online. Also included are general articles and research papers using CE data, including documents in the CE research library.

For more detailed information on the availability of current and earlier data, contact the Division of Consumer Expenditure Surveys, Office of Prices and Living Conditions, Bureau of Labor Statistics, 2 Massachusetts Avenue, NE, Washington, DC 20212-0001; call (202) 691-6900; email: cexinfo@bls.gov; or visit us online. Information in this publication is in the public domain and, with appropriate credit, may be reproduced without permission. Upon request, the information in this report will be made available to individuals who are sensory-impaired individuals. Voice phone: (202) 691-5200. Federal Relay Service: 1-800-877-8339.